Business Credit Mistakes - CL King and Associates

Small business owners of all types have trouble with business credit. The reason for most is that you got into business because you loved the type of company you started; not because you were a wiz at financing and applying for loans.

It's not your fault; the cards are stacked against you.

In fact, many lenders and loan officers would rather you make these mistakes when building credit for your business, because it puts them at an advantage over you.

Here's some common mistakes discussed by our experts at CL King and Associates that owners of small companies make when attempting to build corporate credit.

Getting Misled With Applications

Applying for loan or financing applications that aren't really corporate credit applications at all. It's deceiving, but many so-called corporate credit cards, are nothing more than a personal card account disguised as a corporate credit card. You can always tell by looking at the application to see if it asks for your company's Tax ID number or not. If it doesn't ask for it, then it's definitely a personal credit account that you get to have your company's name printed on it as well.

Taking On Company Debt Personally

Supplying a "Personal Guarantee" for a credit line or loan for business. The purpose for building corporate credit is so that your company's ability to pay and credit-worthiness is evaluated separately from your personal credit. This is vital to making sure that your personal finances do not become tangled with your business finances.

Going Too Fast

Applying for too many new accounts and lines of credit for your business within too short a period of time. It's generally frowned upon to apply for many new credit accounts all within a short time frame to one another because it looks like you are in financial distress to lenders. It's always best to spread your applications out over a larger amount of time when possible.

Even if you've made these mistakes, don't be frustrated. Building and establishing credit for a business can be a challenge and rewarding all at the same time. Keep track of your progress as you go, and you'll be on your way to success.

If you want to learn more, consult with the experts at CL King and Associates.

CL King provides investment banking, equity research, sales and trading, and investor services to corporations and institutions. The firm also co-manages bond offerings, IPOs, follow-ons, secondaries, convertibles, and preferred.

If you want to learn more, please visit here: http://www.clking.com/